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Fixed mortgage rate offers below 3% arrive with HSBC's Premier new one year and eighteen month rates. They cut all other fixed rates too

Personal Finance
Fixed mortgage rate offers below 3% arrive with HSBC's Premier new one year and eighteen month rates. They cut all other fixed rates too

HSBC has become the first of the recognised home loan lenders to push fixed mortgage rates below 3%.

Effective Monday, March 30, they will lower their one year and eighteen month fixed rates to 2.95%.

Their new one year Premier offer of 2.95% involves a cut of -59 bps. Their new eighteen month offer of the same rate involves a cut of the same.

Heartland is the only other bank with fixed mortgage rates below 3%, but they have stated it it be only a live trial to assess market acceptance for them entering this sector.

At the same time, HSBC has dropped its fixed rates for all other terms, although none of them are market-leading. They are however all much lower than the main mortgage banks in New Zealand.

HSBC's Premier offers come with some unique qualification conditions; combined lending of $500,000 or more, or $100,000 of savings and investments with HSBC.

HSBC did not announce any lower term deposit rates with their mortgage rate cut. Update: They have now announced cust to TD rates as well.

Earlier this week, a number of other banks lowered their fixed home loan offers as well. Details are here.

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Wholesale swap rates have also been moving recently, but this market is somewhat chaotic at present, chopping from big falls to some sizeable rises. Overall the trend is down. But liquidity in these markets is very strained and banks' abilities to actually source significant new wholesale funding is in question. Investors sense heightened risk and low rate deals will be hard for bank treasurers to stitch together. However, HSBC proves it is possible.

Here is the full snapshot of the advertised fixed-term rates on offer from the key retail banks.

Fixed, below 80% LVR 6 mths  1 yr  18 mth  2 yrs   3 yrs  4 yrs  5 yrs 
as at March 30, 2020 % % % % % % %
ANZ 3.65 3.05 3.49 3.35 3.99 4.75 4.85
ASB 3.89 3.05 3.75 3.39 3.69 3.79 3.89
4.79 3.09 3.05 3.35 3.69 3.79 3.89
Kiwibank 4.29 3.09   3.39 3.65 3.99 4.09
Westpac 4.79 3.09 4.25 3.39 3.69 3.79 3.89
Bank of China 5.15 5.25   5.35 5.50 5.70 5.99
Co-operative Bank 3.25 3.25 3.35 3.45 3.69 3.89 3.99
China Construction Bank 4.70 3.15   3.15 3.19 3.30 3.45
Heartland Bank   2.89   2.97 3.39    
ICBC 4.29 3.18 3.18 3.18 3.20 3.99 3.99
HSBC 3.64
HSBC 4.29 3.39 3.69 3.55 3.89 4.19 4.29
  3.89 3.39 3.55 3.55 3.89 4.45 4.55
Price Match Promise   3.05 3.05 3.35 3.69 3.79 3.89

In addition to the above table, BNZ has a unique fixed seven year rate of 5.20%.

Fixed mortgage rates

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I guess some good news is that if any home occupier or even land-lord can hold out to the end of their fixed term, they may see some huge relief in interest costs


Interesting - I wonder how they're going to continue to attract deposits? My NZD is heading off to the Perth Mint!


If this country keeps on equates the economic strength to means just that.. OCR rates, bank rates, home loan rates. Then what can we say? - We've put ourselves in the position of economic business engine which that can only works when we put only one petrol type: RE/property loan valuation to turn the engine cycle. Watch what is going to happen when we rely heavily with just 'One of everything' in our dynamic living life span. Good luck!